• The focus is on consumer savings, jobs and economic development
• The FCC is aware that changing funding mechanisms presents issues for incumbents and other businesses. That’s why they are trying a gradual approach. But there are winners and losers (although who they are depends on who you ask).
• The last chapter of FCC has yet to be written and that’s making it difficult for businesses to plan
• There is still a focus on the US and comparing Minnesota to other states. Folks weren’t asking a lot about international perspective.
• Privacy was one issue where international perspective came up. The EU and other areas puts a premium on privacy; the US does not.
• Minnesota is unique in that broadband has become a county-level issue.

Full Notes…

Broadband Perspectives from the Dayton Administration

Members of Governor Dayton’s Sub-Cabinet on Telecommunications will discuss the creation of the Sub-Cabinet, the goals of the Sub-Cabinet and the goals of their respective Departments.

Commissioner Rothman – Dep of Commerce

Top goals for Governor

• Job creation
• Border to border broadband

We have regulatory job at Dep:

• Wireless
• Cable
• Telecommunications

We think this is critical:

• Monitor broadband development across MN
• Issues in Aug
  • Task Force – charged with doing analysis and comprehensive action plan by end of this year.
  • Establish a subcabinet: Rothman, Phillips & Parnell
  • Created a BB development office in Commerce

We have high goals for Minnesota. We need everyone to work together.

Commissioner Phillips – DEED

Lots of studies that indicate that communities with broadband have an economic development advantage. We work with site selectors. Broadband is now lumped in with common infrastructure such as sewer.

• California did a study saw 6 percent advantage for areas with broadband.
• Dep of Commerce found that broadband was an advantage to businesses especially for IT
• Online sales is $6.2 billion industry
• Broadband is a great equalizer especially for rural areas.

ARRA Investments

• 18 programs received $229 million in MN
• We’re going to need to see more programs like this
• We’re going to need to get creative.
• We’ll have to consider options – maybe FTTH doesn’t make sense.

QUESTIONS – none

Practice Perspectives from the Federal Communications Commission
Hear an insider’s perspective on the practice before the FCC.
– Joseph Cavender

Practice Perspectives from the FCC – Joseph Cavender

USF supports 4 areas:

1. High Cost
2. Low Income (Lifeline/Link Up)
3. Schools & Libraries (E-Rate)
4. Rural Health Care

Why reform?

System was designed to support PSTN – not broadband networks. Led to waste and inefficiency. Caused disputes and left hidden costs to consumers.

Objectives:

• Advance universal service
• Fiscal responsibility
• Business realities

Policy Innovations:

• No subsidy for areas served by unsubsidized competitor
• Dedicated support for high cost areas
• Dedicated support for mobile service
• Competitive bidding (reverse auctions) for the first time to award universal service support
• Explicit accountable public interest obligations
• Budget for CAF support

Connect American Fun $4.5 billion annual budget

1. Remote Areas Fund
2. Fixed Locations
   1. CAF Phone I in Price Cap areas
   2. CAF Phase II in Price Cap areas
   3. Rate of Return carriers
   4. Mobility Fund
      1. Phase I (including tribal areas
      2. Phase II (exclusively tribal)
      3. ICC Recovery

CAF I

• Existing legacy high-cost support to price cap carriers is frozen
• Additional $300 million in CAF funding in 2012
• Carriers have 90 days to accept funding; carriers electing to receive Phase I incremental support will be required to deploy broadband to 1 unserved location for each $775 in support accepted

CAF II

• No support for
  • Areas with unsubsidized competitor
  • Low cost areas
  • Extremely high cost areas
  • Incumbent price cap carriers may receive support if they commit to serve support locations within their service territories

Rate of Return Carriers

• Support continued broadband investment, while increasing accountability and incentives for efficient use of public resources
• Think 500 carriers will see increased support
• Reducing support artificially low consumer rates – may have an impact on rural areas that charge low costs

For Mobile Carriers

• For first time Commission recognizes mobile voice and broadband service as an independent goal of universal service
• Phase I; $300 to upgrade areas with no 3G
• Phase I (tribal) Additional $50 million
• Phase II: Ongoing annual support for areas that depend on USF for service up to $500M/year & $100M/year for tribal

What was wrong with ICC?

• Quite complex
• Carriers faced declining revenues
• Uncertainty related to VoIP traffic
• Arbitrage led to phantom traffic
• Consumers were ultimately bearing the burden

ICC Reforms

• Adoptions rules to deter access stimulation
• Adopts bill-and-keep methodology
• Adopts prospective default for VoIP-PATN traffic
• Created a recovery mechanism for incumbent LECs Access Recovery Charge (ARC)

Further Rule Making

• Bringing remaining rate elements to Bill-and-Keep
• Bill-and-Keep implementation
• Reform end user charges and CAF
• IP-to-IP interconnection

Connect America Fund Panel
The new Transformation Order fundamentally changed the allocation of high cost support and intercarrier compensation. This panel will discuss the impact of the Order on ILECs, CLECs and wireless carriers. It will also review the pending appeals.
– Joseph Cavender
– Philip Schenkenberg
– Jim Campbell
– Dan Lipschultz
– Shannon Heim, moderator

CONNECT AMERICAN FUND PANEL

CLEC need the following:

• Pricing of network elements (unbundled or special access) is still open issue
• CLEC are denied access to fiber networks (old FCC issue)
• No compensatory measure for CLEC
• CLECs pay into CAF, but cannot get money out

What do CLECs get? Lower revenue, no compensation, required to pay into a fund, can’t get fiber.Are we funding our own demise?

Silver lining? There are pending issues that may change this situation. They are taking graduated approach.

CenturyLink

• Maybe a winner, maybe we loser with CAF. (Depends on decisions moving forward)
  • Hope to get some funds.
  • We do lose a lot of access revenue
  • We are debating CAF Phase I funding mechanism
  • Entitled to $89.9M – must decide by July 24
    • But includes significant obligations (need to get to unserved customers for every $775 et al)
    • Need to decide where to spend money
      • CAF shoots for low hanging fruit
      • 83% of unserved are in Price Cap carrier territory so it made sense to go to the source
      • CAF II – need to serve remainder of eligible unserved areas (4/1Mbps) – by state
        • Cost model is important – too low will slow down process

 WIRELESS

• By USF – yes we were winners
• Large wireless providers have already seen shrinking USF (via merger permissions)
• Can anyone put together a business plan to take CAF?
• In 1996, FCC recognized wireless as emerging business
  • Policies were friendly to all technologies, esp wireless
  • There were 44 million wireless connections (in 1996) – now we have more connections than people
  • We are coming closer to 100% coverage)
  • ICC – we’re happy with bill-and-keep, we’ve always worked that way
  • ICC – we’ve had agreements with incumbents – but is there still a need?

 RURAL CARRIERS

• We have high cost areas
• We have pushed out phone service, via USF
• Now we’re transitioning to broadband
• Esp rate-or-return are getting cut
  • It will hurt some help others – but dice are still rolling
  • Hoping to maintain budget
  • Stranded investment is a very big deal
    • Investments have been made based on old rules
    • How do we continue to serve these loans

 QUESTIONS

Are CLECs funding their own demise?

FCC answers – it’s true everyone contributes. Some people get more out of it than others. Wireless providers might say the same. Interconnected VoIP have been paying too –without hopes of recovery.

CLECs are in line for possible support in Phase II. (Without taking full state commitment.)

The Commission is no longer supporting duplicative service in any one area (Mobile being different.) If there isn’t support for one provider, tax payers should not have to support a second provider.

 If you win funding in Phase I – are you ineligible for Phase II? If you get money to build – can you still get money for operating funds?

Phase II is not set in stone yet – but that is not the plan.

It’s tough to accept Phase I when we don’t know the rules for Phase II. Tough to create a budget plan with so many unknowns. DO how can one bid on the reverse auction?

The FCC understands the issue. Phase I is no designed to bring Phase I everywhere. It’s meant for areas that really just need one short of support. Most areas see that it’s an OPEX issue, not a CAPEX. But the folks who need CAPEX are the best case scenario for Phase I.

The wireless bureau did an analysis of 2G areas that would be ready for 3G. There were enough areas that would benefit from one-time investment to move this forward.

How are Mobility Phase I areas being identified?

Done on a census block area – there’s a map on FCC of qualifying areas.

Reverse auction for high cost areas is new (planned for Sept 27). What are the thoughts?

Know about it from Spectrum. Haven’t been very involved but seemed effective with Spectrum. Like it in terms of land lines.

What did FCC not allow common (aggregate) bidders?

To prohibit collusion.

Unfortunately it does make it more difficult for small providers to participate.

Who does reverse auction favor?

Favors whoever can most efficiently provide service.

Carrier of last resort. Will our notion change?

CenturyLink – we tried to get the FCC to lose the idea of carrier of last resort. That obligation has largely been addressed. If you’re going to focus on broadband – getting rid of carrier of last resort will help folks move forward. Funding is required for broadband carrier of last resort.

If you maintain carrier of last resort –the regulators should support those networks. However if there is no carrier of last resort, do we leave it to end user?

The rural folks are more supportive of carrier of last resort. We maintain the last resort connections, and we get support for it.

Sometimes our problem (in rural area) is the middle mile.

Generally people will build where they can make money – and that’s an issue for building out to areas of last resort. So carrier of last resort forces regulators to look at how to build out to those last resort areas.

IP-to-IP will be another issue.

What’s the process that FCC provides guidance to USAC? Any efforts to make current process more transparent to public?

We’ve talked about it. We’ve been trying to formalize the process and make it more transparent. We’ve issued guidance documents to USAC.

We do work near each other and there is less formal communication as well.

They are the repositories of info – and we occasionally ask them for info.

There’s a sense that there’s a lot of chatting that we don’t know about. There’s speculation on how much happens.

Artificially low rates – how do you factor in calling scope? IN rural areas I might only be able to call 900 people, in urban areas phone users can call thousands of people.

FCC looked at rates and they varied greatly. We thought that folks should be paying comparable rates. We ask about rates; we don’t ask about calling areas. Traditionally we’ve looked at areas where rates have been “too high”, looking at rates that are too low.

Other issues

Transition to Bill-and-keep

Two legal issues:

• Does FCC have authority to step into state areas
• Does FCC have authority to do bill-and-keep

Broadband in Minnesota
Update on broadband enrollment and deployment progress in Minnesota and a review of the impact of BTOP and BIP grants in the state of Minnesota.
– William Hoffman
– Lyle MacVey
– Christopher Sandberg, moderator

BROADBAND IN MINNESOTA

Bill Hoffman on Connect Minnesota

Primary Program Components

• Data Collection & Mapping
• Survey & Research
• Planning
• Program Development

Statewide Availability – Percentage of households reaching MN Broadband Goals:

• In Oct 2011 57.4
• In April 2012 59.92 (not yet confirmed or published, will be released within the week)

 Lyle MacVey – NESC

• Working on ARRA-funded Middle Mile – Regional Network serving Community Anchor Institutions in Northeast Minnesota.
• Working with Cook County and Lake County for last mile services

ARRA Funded Projects

• Anoka
• Carver
• LqP
• SMBS (Southwest Minnesota)
• Lake County
• Arrowhead Electric
• NESC

Other projects in Development

• Sibley County
• Todd County
• Cloquet Valley
• Redwood County
• Kanabec County
• City of Prior Lakes

We are looking at possible impacts of CAF and ILEC/CLEC response

In rural areas – you can build FTTH if you have the density. It’s the long haul (to TCs, to Chicago) that is expensive.

Trends in Projects

• Movement to Countywide projects
• Movement to public-private partnership
• Majority of projects fiber based
• Projects are rural in nature
• Looking for ways to bypass referendum requirements
• Biggest challenge is lack of funding sources other than bonding

Rate Trends

Consumer and Small Business (DSL/FTTH)

• Baseline holding steady – rates not falling
• Multiyear contract incentives

Carrier & Large Enterprise (Middle Mile)

• Greater Competition
• Prices in rural markets state to fall
  • 100 Mbps @ $675/month
  • Price matching and network leveraging

Challenges

• NTIA/USDA funding releases slower than expected
• Construction costs higher due to David_Bacon impacts
• Changes in Design or Scope
  • Result in lengthy reviews and project delays
  • Transparency difficult to assess both in terms of access to and release of; MN Data Practices Act (have had 5 intentional fiber creaks)
    • Business plan, rate structures

Result

• Projects falling short of original milestones and scope

Opportunities

• Technical Assistance Survey Results
• Leveraging Community Assets
  • Tower leases and public lands
  • Equal Opportunity and Access
    • Establishing Ground Rules
    • Public Common Carrier VS ISP
    • Education
      • Understanding FCC rules.

 QUESTIONS

How are people answering question about computer ownership? They aren’t counting smartphones and tablets.

Connect MN will change the question.

You mention engineering as project issue and 20% over cost. Can you say more?

It’s primarily in underground topology in NE Minnesota. Part of engineering is also inspection – and that can take longer.

How does Minnesota compare to other states?

Mid pack. Working on adoption would help.

Keynote Address: Assessing Broadband in Minnesota
The former Speaker of the House of Representatives and current Chair of the new Minnesota Broadband Task Force will provide her perspective of the state of broadband in Minnesota
– Margaret Anderson Kelliher

NextGen 911
The shift to broadband and IP is changing the way 911 services are used and delivered. With the explosion of mobile devices and data services, calls for emergency response are not just coming from telephones anymore. In this panel we’ll hear about what is happening at the national and state level regarding how emergency response networks must change to become next generation emergency response networks.
– Trey Forgety
– Anthony Mendoza, Moderator

NextGen 911

Tony Mendoza

• Need to access and locate different types of media – VoIP & Text
• Legislation was raised (didn’t pass) concerning all IP 911 network

Trey Fogarty at the 911 Association

• Primary standards development organization for 9-1-1 systems and service processes.
• 7000+ public safety and 9-1-1 industry  members
• The only professional organization solely focused on 9-1-1 policy, technology…

How we communicate

• By 2014, most Internet traffic will be mobile
• Voice communications account for only 1/3 of mobile usage; 2/3 are apps, test & video
• Approximately 32% of adults and 36% of children live in wireless-only households
  • Exception – folks will get the phone if it gets bundled with broadband
  • More than 8 trillion texts were send last year
  • Teens text 5,500 times per month
  • 35 million Americans who are deaf or hard of hearing rely on texting
  • IP-based messaging services such as iMessage are beginning to displace SMS

What’s driving NG9-1-1?

• The need to mainstream 911 technology
• Needed improvements in survivability
• The critical need to improve interoperability and information sharing
• A desire to increase competition and innovation in public safety technology

Built-In Interoperability

NG911 is:

• An open standards-based platform
• Using modern, flat IP Architecture
• With robust security and resilience features
• Based on Commercial Off the Shelf (COST) technology
• Designed to be originating-service agnostic

NG911 Responder Benefits

• Allows seamless flow of data from consumer to call-taker to dispatcher to responder
• Leverages existing national standards for interfaces and data structures
• Provides an adaptable platform to meet future responder needs

Recent Legislation – http://www.nena.org/?page=Standards

• Now is the time to start thinking about NG9-1-1

QUESTIONS

What kind of consumer education do you see happening?

The FCC asked in the rulemaking – should we do something now to deal with Americans communicating via text? The answer was yes – especially for folks with disabilities.

Text to 911 mandate may appear this summer – with a 3-5 year expectation.

If you’re a carrier a best practice – text back to people who text 911 to tell them to call 911. In the long term, start planning. Verizon is doing a text to 911 rollout.

Municipal Broadband
A review of municipal broadband projects in the state of Minnesota.
– Milda Hedblom
– Christopher Mitchell

Municipal Broadband: Milda Hedblom & Chris Mitchell

How did National Broadband Plan support municipal network?

States had the right to tell communities that they couldn’t build a networks and/or put stipulations on building the network. But the NBP gave a clearer sense that it wasn’t’ the case.

How does MN fit in compared to other states?

Minnesota is unique in that there’s a focus on counties.

You have looked at exemplar projects (such as Bristol, Chattanooga). Are there lessons to learn?

Chris just released a paper on the topic. They all of Gig to anywhere in the city. Here are some characteristics they share:

• Municipal electric department (only 2000 cities have this)
• They were prepared to act as a business (get, take customers)

Comment on counties…

Minnesota wants to be one of top 5 states by 2015. Counties have found that it’s hard to run a modern business without broadband. Folks with good access are often getting it from coops. Groups of people in the county are realizing that if they don’t act, they will be left behind.

Minnesota’s counties are looking at public-private partnership, community networks, working with private providers.

USF reforms will be interesting but so far seems insufficient.

There is no one-size-fits all solution. Different counties have different assets. Almost all counties are looking for partners of one form or another.

Ramsey County has aspirational plans. Sibley County has now made a commitment via Joint Power with ambitious goal of bringing fiber to farms.

JoAnne Johnson – U-reka update

1. Did feasibility for Todd County. We’re meeting with community and updating them. There was about 1 year between first meeting and completion of report. They are working with Arvig to match Blandin support.
2. We’re finding more enthusiasm from private partners. And more trust from public partner to work with private partners.
3. Working with Kanabec County – approved last night. It will be a marketing survey, 10 year financial study…
4. We’ve seen success with Middle Mile project – and now we’re investigating access to the home.

There are obstacles for public participation…

• There are 19 states with some form of barrier for private sector getting into providing/building broadband service.
• Municipal network has barrier of super majority referendum  for providing phone services – maybe it makes sense to make that 50%

Monticello – it went into operation with an overhang of debt (due to lawsuits). It’s been a huge obstacle. Perhaps we need to judge them not based on economics alone.

Serving the Underserved
A review of the legal requirements and programs designed to serve low-income families with broadband services. The programs of Comcast and CenturyLink will be featured.
– Karly Baraga Werner
– Jim Campbell

SERVING THE UNDERSERVED

Comcast

• The digital divide is a real problem and it is growing. 92% have access only 65% have adopted broadband
• Half of non-adopters are low-income families
• So we need to focus on low income families
• Big barriers – Internet Essentials was developed with FCC to address all issues
  • Cost (36%) – connectivity and equipment
  • Digital Literacy (22%)
  • Relevance (19%)

What has the FCC done?

• Supporting Connect to Compete (piloted in California right now)
• Feb 2012 – FCC released the Lifeline Reform Order
  • Permit eligle customers to apply Lifeline discounts to bundles that include voice and broadband
  • Creates a Pilot Program to study application to the adoption challenge of a subsidy for the price of BB service.

Details on Internet Essentials – http://www.internetessentials.com/default.aspx

• $9.95/month – XFINITY Internet Economy Service (currently 3 Mbps down)
• Option sot purchase computer for $149
• Free Internet training
• Can remain on program as long as kids are in school and qualify for free lunch

We’re trying to get the word out.

CenturyLink

Internet Basics – http://www.centurylink.com/home/internetbasics/?rid=internetbasics

• Service discount $9.95
• Equipment discount ($150 notebook)
• Training – and 24/7 tech support
• Committed to spend $2 million on the project over next 2 years
• We focus on families and seniors

QUESTIONS

How is enrollment?

It was slow to start. But we’re seeing an uptick and we (CenturyLink) will be working with school next year.

Comcast is at 5% of eligible students.

Is childcare assistance a qualification for CenturyLink?

Not sure.

What issues were there in Minneapolis (for Comcast)?

We found that when we can get a brochure in a backpack, we have success. But there are some reservations with some schools to have an appearance of supporting one business. And principals are busy.

Making the parallel between reduced lunch programs and reduced broadband rates helps.

Comcast has brochures in 13 languages. And we have a partnership with Hmong American Partnership.

Are there avenues to reach seniors that have been successful?

Going to where the seniors are has been helpful. Also we can direct mail to phone customers. And we’ve gone back to paper – we bring paper applications to meetings.

Privacy/E-Commerce
Our speakers will provide an update on developments in privacy law, including a discussion of the new FTC Privacy Report, the EU Privacy Directive, Google’s new privacy policy, the Obama Consumer Privacy Report and the impact of recent developments on mobile applications.
– Jamie Nafziger
– Professor William McGeveran
– Brad Bolin

PRIVACY / E-COMMERCE

Dorsey Whitney – Ways that our data is getting collected

• Fear of privacy may be holding back adoption

This is the info an App Developer can access

• Unique Device Identifier
• Contacts in your address book
• Current GPS coordinates
• Photos in your photo gallery
• Email account info
• Phone info
• Videos watched and searched.
• Web search history
• Keyboard cache

Facebook OpenGraph Apps (Frictionless Sharing)

• What you read
• Songs you listen to
• TV shows you watch
• Movies your watch (outside US)
• Your exercise results
• What you cooked
• What you are wearing
• What you want
• Where you are traveling

Ad Network/Data Broker

• Age
• Gender
• Income
• Ethnicity
• Sexual Orientation
• Political Views
• Parental status

Best Buy –

Think about the power that a business has in terms of having all of your info – but also understanding relationships based on info and that the business has the ability to feed you info when they choose it.

UMN Law School Professor –

We have a class to give our students an edge.

A lot of this is driven by what info can be gathered but also the algorithms that give even more info.

There aren’t a lot of laws out there now. But the Future Privacy forum are active.

• Slow movement towards increased federal role in regulation (FTC report and Obama/Commerce report)
  • Both reports pretty much say – there’s a lot to think about
  • They are looking for best practices
  • They are inclined to ask for privacy by design
    • Set defaults
    • They don’t want to kill the goose that lays the golden egg
• The rest of the world is proceeding in a different direction – data protection (not privacy)
  • Looking into right to be forgotten
  • Providing end users with access to info
  • Changing from guidelines to regulation
• Emerging US privacy strategy

QUESTIONS

Differences between EU & US have been ongoing. EU have made information a right. If agreements are 20 years long – is that part of US companies’ strategy to avoid stricter rules for a while?

The gulf between EU and US is growing.

One key concern is that less certainty is not good. The agreements led to more certainty.

There is drive in US policymakers to try to increase harmony between US and other places.

The powerful companies will hold out for US rules are long as possible.

On right to be forgotten – is it like right of withdrawal?

Loosely, yes. The US has longstanding rule on freedom of speech. And we prioritize that. We’re kind of libertarian on it.

EU countries see rights differently. They also have identity rights, rights of attribution, right of withdrawal.

Is common law developing on shrink wrap agreements?

Yes in FTC – mostly Section 5 deception trade practices.

In February, The Middle Class Tax Relief and Job Creation Act of 2012 was signed into law. It included a section that opened the door to the First Responder Network Authority (FirstNet).

Title VI – Public Safety Communications and Electromagnetic Spectrum Auctions

Sec. 6101-6703 – Spectrum Auction. This provision grants the FCC the authority to hold voluntary incentive auctions, allocates necessary spectrum for a nationwide interoperable broadband network for first responders, provides $7 billion for public safety broadband network build out, and provides up to $1.75 billion for relocation costs for broadcasters. This provision is estimated to raise $15 billion over the next eleven years.

The FirstNet plan is to build a broadband network for police, firefighters, emergency medical service professionals, and other public safety officials. FirstNet is really just getting going – but there are some plans. First plan is for FirstNet to work with state, local and tribal governments. A goal is to create an interoperable, cohesive, countrywide network. That being said, states can opt-out of FirstNet. Apparently the plan (and I’m gleaning this from the webcast) is for FirstNet to come to the states with an assessment of what the state has and what they need. And RFP will be created from these assessments.

The webcast included folks from all corners of the project (commercial, utilities, local governments (well NATAO – the National Association of Telecommunications Officers and Advisors). It was nice to hear each perspective. The need for a Public Safety Net was emphasized. I think many of us have heard the stories of different branches of first responders and/or first responders from different areas running into troubles communicating with each other because of technology. So change seemed to be welcome across the board – especially change that meant interoperability!

Sustainable was another theme. One thing that I always remember from the 700 Mhz Auctions in 2008 was that the Public Safety spectrum was the one auction that did not meet its minimum. No one wanted to build the public safety network back then. So what’s changed? I think it’s the greater opportunity for corporate carriers to ride on the network and the opportunities for commercial providers to take advantage of network sharing and roaming.

If sustainability is an issue, it makes sense to get the carriers involved. But I think it’s important to maintain an open source sort of network. One of the issues noted in the webcast was the failure of the current network is the proprietary nature of some many (or many portions) of the public safety network. Another point made by the utilities and local governments is that they have a lot of infrastructure in place already, suggesting that maybe that could help defray costs to build.

It sounds as if network will be 4G LTE. (I guess that would be more meaningful to be if there more stringent standards on what that meant.) One inherent issue they mentioned in the webcast was lack of voice capabilities on 4G LTE. However there is a budget for NIST (National Institute of Standards and Technology) to develop a solution and until there’s a solution, t-band spectrum (for voice) could be made available. (I should say someone asked about that – and the answer was that t-band availability would depend on NIST developments.)

So there’s movement forward. Some of the budget and spectrum are apparently still up in the air and will be based on the reverse auctions that are planned. (There is up to $7.3 billion in funding for network from future FCC incentive auctions but the NTIA can borrow $2 billion up front.) Also there’s a lot of discussion on who will be selected for the various FirstNet boards. With $7 billion dollars at stake and so many stakeholders in the game, those decisions will be critical to how FirstNet continues to move forward.

There are a couple other issues that I find intriguing – but will have to wait for another day: Text-to-911 and Commercial Mobile Alert System, which sounds like tapping into commercial cell phone carriers to broadcast “emergency broadcast system” type messages. (I think most readers will remember watching those as kids when the remote control was maybe a slow younger sibling.) I think the idea of “delivering geographically-targeted alerts to wireless consumers” could be lifesaving – but also opens the door to a lot of privacy concerns.

News from the Blandin on Broadband Blog

Broadband Task Force Visits Benton County
The Minnesota Broadband Task Force visited Sauk Rapids for their March meeting. It was an opportunity for the Task Force members to learn about the Minnesota Intelligent Rural Communities (MIRC) from a participating community. They also heard from local residents about what is and what isn’t working with local broadband deployment and adoption. http://wp.me/p3if7-1DJ  The next Task Force meeting will be on April 17 in Dakota County. (Details to be announced later.)

Internet Traffic to Double?
According to International Data Corporation, Internet-generated broadband traffic will increase approximately 50% year-over-year on fixed networks and double on mobile networks. http://wp.me/p3if7-1Dp Telecom providers are preparing for an increase and are talking about the role they can play with two broadband drivers: video and cloud computing. http://wp.me/p3if7-1E1 Others in the industry are asking about the role of wireless; could it (should it) replace or supplement wired solutions? http://wp.me/p3if7-1DL

Broadband Adoption – Why and How?
According to the Boston Consulting Group, the Internet accounted for $684 billion, or 4.7%, of all U.S. economic activity in 2010. http://wp.me/p3if7-1Dg If you’re not using the Internet, you are not in the running for taking advantage of that market. At the personal, business and community level, it makes sense to promote better broadband use. Luckily there are some tools to help.
• The Institute of Museum and Library Services (IMLS) unveiled tools to help communities address digital inclusion. http://wp.me/p3if7-1DE (See an annotated list of IMLS resources http://wp.me/p3if7-1CS)
• AT&T is encouraging greater use of broadband in education with their Aspire Education Grants. http://wp.me/p3if7-1Dd
• NetZero is offering a free wireless Internet option. http://wp.me/p3if7-1D7

Broadband Applications
MAP for Nonprofits recently released a report that highlighted innovative use of broadband and technology by Minnesota-based nonprofits. http://wp.me/p3if7-1D1 Projects range from creating shared databases that improve services to clients to shifting to texting to reach high school students. The key is not focusing on the technology but focusing on using technology to solve a problem.

Policy Update
Several broadband related bills were introduced to the Minnesota Legislature last month. Topics included tax issues and broadband equipment, fiber grants for education, restrictions on community networks, wireless hotspots in rest areas, the role of the PUC (Public Utilities Communication) and online learning. http://wp.me/p3if7-1CE Many of the bills remain stagnant but movement has been seen in the online learning bill, which would make digital learning a graduation component in Minnesota schools. http://wp.me/p3if7-1Eh. On a national level, the Minnesota Telecom Alliance has been keeping on with what’s happening at the FCC (Federal Communication Commission). http://wp.me/p3if7-1CX

Local Broadband News

Alexandria
Students in Alexandria adopt MIRC-developed digital inclusion curriculum and work with local seniors to boost computer skills and intergenerational friendships. http://wp.me/p3if7-1Dm

Austin
Working with PCs for People, Austin will soon receive 75-100 computers for low-income households. http://wp.me/p3if7-1E8

Cold Spring
Remote telehealth options are made possible in Cold Spring Minnesota as GrandCare helps local residents get connected to healthcare solutions and loved ones online. http://wp.me/p3if7-1Dv

Jackson
ARRA-supported Southwest Minnesota Broadband Services opens an office in Jackson. http://wp.me/p3if7-1DA

Minneapolis
Minneapolis Digital Inclusion Funds runs into issues with US Internet falling short of estimated contributions, which was part of their proposal to provide the city with wireless service. http://wp.me/p3if7-1Ds

Sartell
A senior housing center in Sartell has setup six wireless hotspots and seven iPads to encourage residents to learn about new technology. http://wp.me/p3if7-1CH

Sibley & Renville Counties
Sibley & Renville Counties postpone vote on FTTH community network initiative. http://wp.me/p3if7-1DW

Twin Cities
Cash mobs, quick but planned, rapid local buying, boost business for target Twin Cities’ shops. http://wp.me/p3if7-1Ee

The Nerdery gathers a troop of 180 volunteers to build 18 websites for local nonprofits in 24 hours. http://wp.me/p3if7-1DG

Events

April 4 – Spectrum Provisions of Tax Relief Act — Meaning, Impacts and Timing webinar http://wp.me/p3if7-1Eb

April 11 – TISP: Making the Connexion: A progress report on Eagan’s Data Center (Minneapolis) http://wp.me/p3if7-1E5

April 17 – Minnesota Broadband Task Force meeting (Dakota County) http://tinyurl.com/7n2syt8

April 25 – Minnesota High Tech Association Spring Conference (Minneapolis) http://tinyurl.com/7t6oner

May 8 – Minnesota Broadband Task Force meeting http://tinyurl.com/7n2syt8

Looking for more events? Check out TechDotMN’s calendar http://tech.mn/events/. Many events are based in the Twin Cities but it is a comprehensive list. (If you have an upcoming event, consider submitting it.)
Looking for local MIRC (Minnesota Intelligent Rural Communities) events? Check the MIRC Google calendar: http://tinyurl.com/3oz5uzh or University of Minnesota Extension MIRC calendar http://tinyurl.com/66vxghj

Stirring the Pot

Last week in his MPR Blog, Dave Peters took an interesting look at the ever-evolving fiber vs. wireless question. http://tinyurl.com/7x23wq4 It is a question that I get at every community broadband meeting that I facilitate.

On one hand, you have fiber. You know what you are getting with fiber – high capacity, extremely reliable, triple play services and more, and quite expensive to deploy in the rural countryside.

When people talk about wireless, confusion abounds. People use a combination of marketing and technical terms interchangeably. When bandwidth caps are discussed, people want to know “just how much is 2 Gb?” Wireless technologies may or may not be influenced by weather, trees and/or terrain. Frequencies may or may not be licensed. Accuracy of provider coverage maps is debated.

Peters’ blog also raised this important question – If an area is served first by a wireless broadband provider, will that kill the market for investment in upgraded FTTH or FTTN services? Will rural residents be generally satisfied enough with a lower capacity wireless service that there will not be the groundswell of support and commitment to motivate a significant investment in fiber, thereby causing an area to be underserved long into the future? I tend to think probably so.

Yet we would never argue the opposite case – that a new fiber network would dissuade investment in wireless technologies. Mobile connectivity is now an expectation and people have proven that they are willing to pay for it. The large wireless carriers have announced aggressive plans to extend 3G and 4G coverage areas to more rural areas.

I was quoted in the blog as stating that people need both wired and wireless services. I also think that the bar for fiber advocates continues to rise. More than ever, they need to demonstrate the value of large bandwidth applications, especially those that have been or could be deployed by local institutions like schools and health care providers.

More than ever, communities need to have a technology plan that ensures both fiber-based and wireless services coupled with an application deployment plan. Communities lacking any of the three – wired, wireless and applications – will struggle to compete for talented people and business investment.

Bill Coleman helps communities make the connection between telecommunications and economic development. As principal in Community Technology Advisors http://tinyurl.com/3f4dx7g for ten years, he assists community, foundation and corporate clients develop and implement programs of broadband infrastructure investment and technology promotion and training. Bill is working with the Blandin Foundation on the MIRC Initiative http://tinyurl.com/2c6mhh4, Community Broadband Resource Program http://tinyurl.com/cseu7e and other broadband projects.

Broadband US TV (www.BroadbandUS.TV) invites you to attend the free live video webcast of Spectrum Provisions of Tax Relief Act — Meaning, Impacts and Timing

Wednesday, April 4, 1:00 – 3: 00 pm ET

Register Here

Please join co-hosts Marty Stern of K&L Gates and Jim Baller of the Baller Herbst Law Group for the next program in Broadband US TV’s broadband policy free webcast series. This program will focus on the spectrum provisions of the Middle Class Tax Relief Act, the most significant piece of spectrum legislation in almost twenty years, with two expert panels:

Implications for Public Safety and other Governmental Entities featuring Stephen Traylor, Executive Director, NATOA, Brett Kilbourne, Deputy General Counsel, Utilities Telecom Council, Brett S. Haan, Deloitte Consulting, and Roger Wespe, Government Relations Manager, APCO International; and Implications for Broadcasters, Wireless Carriers and Tech Interests featuring Michael Calabrese, New America Foundation, Lawrence Krevor, Vice President, Sprint, and Kevin Krufky, Vice President, Public Affairs, Alcatel-Lucent, and Peter Tannenwald, Member, Fletcher, Heald & Hildreth.

For additional details about this event, please click here. This webcast is the latest in Broadband US TV’s Broadband Policy Series/Inside Voices on Critical Choices, which tackles major issues in the broadband field. The programs present high-profile speakers of differing views and elicit lively, spirited and balanced debate. A recent program in the series was entitled “Broadband Competition: Fact or Fiction” originally webcast on February 28, 2012. Watch the program by clicking here.

LightSquared vs. GPS

A new wireless start-up with Minnesota connections has been in the news lately with plans to provide a unique wireless-satellite communications network that could bring ubiquitous broadband coverage to rural America for a fraction of the cost of existing, limited service.  The issue?  The new LightSquared network threatens to overwhelm America’s Global Position System (GPS) receivers, making the devices obsolete.

The Company and the Technology

Reston, Virginia-based LightSquared Subsidiary LLC was formed in 2010 with plans to provide a wholesale, nation-wide 4G-LTE wireless broadband network with integrated satellite coverage.  The new service is built on spectrum used by two Mobile Satellite Service(MSS) sat-phone companies Inmarsat and SkyTerra, and has announced a significant network partnership with Sprint-Nextel.  Forbes magazine reports that the company invested $50 million to develop new microchips to provide dual-mode wireless at a price below existing cellular service.  By avoiding costs of supporting legacy voice networks, LightSquared projects to wholesale 1 gigabyte data service for about $7, compared to the $50-$60 typically charged retail 3G/4G customers today.

In January 2011, the Federal Communications Commission (FCC) issued an Order giving LightSquared conditional approval to build out a ground-based wireless network using its MSS spectrum.  However, that order was subject to further testing and FCC review due to potential GPS interference.

The Issue with GPS

The federal Space-Based Positioning, Navigation & Timing (PNT) Committee has been examining potential interference by the LightSquared network with GPS receivers.  They state the issue:

The base stations of the LightSquared network will transmit signals in a radio band immediately adjacent to the GPS frequencies. The GPS community is concerned because testing has shown that LightSquared’s ground-based transmissions overpower the relatively weak GPS signal from space. Although LightSquared will operate in its own radio band, that band is so close to the GPS signals that most GPS devices pick up the stronger LightSquared signal and become overloaded or jammed.

There is also concern that the FCC may approve a technical solution to the problem that requires millions of existing GPS users to upgrade or replace their devices…

The results [of PNT testing] clearly demonstrate that implementing LightSquared’s planned deployment for terrestrial operations poses a significant potential for harmful interference to GPS services.

There are basically two technical issues.  First GPS signals are very weak—satellites are 12,000 miles above the Earth and operate on solar power—so receivers have been designed to be sensitive to the full GPS spectrum.  This, however, means many GPS receivers also pick up adjacent frequencies.  Second, LightSquared proposes to change weaker satellite signals in adjacent spectrum to much stronger ground-based 4G wireless signals, exacerbating interference.  Further federal testing results, leaked in December, confirm interference with 75% of general purpose GPS receivers;  however, no “significant interference” was found with cellular phones.  The NTIA will next test high-precision receivers used in farm equipment and scientific instruments.

Different groups have suggested different ways to eliminate conflicts.  (The Minnesota Geospatial Information Office (MnGEO) Emergency Preparedness Committee has tracked the evolving issue on their blog.)  LightSquared’s position is that GPS makers were aware of potential interference and should have built better technology.  The company has petitioned the FCC to re-affirm their spectrum license.  LightSquared has also offered to limit initial use of spectrum closest to GPS signals and delay boosting power on ground stations.

Opponents, including The Coalition to Save our GPS, contend that LightSquared is causing the problem by changing from low-powered satellite service with limited ground stations to high-powered ground-based service.  Members of the coalition include GPS makers; agricultural equipment manufacturers such as AGCO, Case New Holland, Caterpillar, and Deere & Company; and national organizations including the American Association of State Highway and Transportation Officials (AASHTO) and the National Rural Electric Cooperative Association, among many others.  .

The Issue with Politics

Many media sources have touched on multiple political issues involved in the LightSquared proposal.  Philip Falcone, a native of Minnesota’s Iron Range, acquired control of the company through Harbinger Capital, his New York hedge fund that is now being investigated by the Securities & Exchange Commission.

Senator Charles Grassley, an Iowa Republican, and FCC Chairman Julius Genachowski have feuded through the year on Congressional oversight in the matter.  The FCC’s National Broadband Plan specifically calls for accelerating terrestrial deployment of MSS frequencies.  Questions have, however, been raised about why FCC approval was granted to LightSquared prior to testing, and also about a report that General William Shelton was pressured by the White House to change testimony to Congress in favor of LightSquared.  Grassley placed holds in December on two nominees to the FCC over the issue.

LightSquared has also touted support where it doesn’t seem to be clear.  For example, a September press release stated that “we received a strong endorsement of our view that LightSquared and GPS can co-exist from several of the country’s leading agricultural organizations…” including the American Farm Bureau Federation (AFBF) and National Farmers Union.  However, far from endorsing the proposal, the letter referenced supports both rural broadband and precision agriculture.  In testimony to the House Committee on Small Business, AFBF President Bob Stallman urged Congress to assure that “LightSquared should cover the expense of all technical fixes to the interference issue.”

-John C. Shepard, AICP

Note:  No endorsement of a particular political position is intended or implied

Executive Summary -

The plan is to move to the Connect American Fund (CAF) which will allocate a $4.5 billion budget annually for rural, insular and hard cost areas.

One the transition is complete that will mean up to $2 billion for rate of areas with return carriers; $2.8 billion for price cap carriers; $500 million for wireless and mobile voice services – including up to $100 million for tribal areas and at least $100 million for remote areas fund.

CAF recipients will be required to send reports to state and federal overseers. The State Commissions will work with carriers of last resort and ETCs (eligible telecommunications carriers).

Price cap – CAF will support broadband in two phases:

• Legacy cost support will be frozen & subject to broadband obligations ($300 million to commit broadband deployment to areas)
• Creates a framework to provide support on forward looking price model. Incumbents will need to overtake statewide commitment (Except very high cost areas and areas with competitors). When incumbents says no – there will be a bidding mechanism for all ETCs)

Rate of return

• Changes rules to support continued broadband deployment/investment
• Allows them predictability of continued funding but requires more stringent monitoring
• Looks to reduce interstate compensation 11.25%

Mobile

• Eliminates identical support rule
• Phases down existing support

More on mobile

• Phase I $300 million and $50 million in tribal areas and reverse auctions with a goal of 4G
• Phase II $500 million per year to extend and support mobile networks ($100 million to tribal areas) in high costs areas

ICC

• Arbitrage – combating phantom traffic
• Billing key methodology for all ICT traffic with unified national framework
• Caps all interstate and most intrastate effective on date of this order and establishes a transition path for the reduction
• Some carriers will be eligible to receive cap support
• VoIP/PSTN – will be subject to transitional ICC; will be considered equal; expect all carriers to act in good faith for IP calls

Copps Comments:

Re: USF

• I would have much preferred a higher budget for the Fund—a budget that I believe consumers would accept because of its importance to putting the nation back to work and providing our kids with the tools they need for their futures.
• The course we adopt today has two auction phases, with the second installment of mobility support dependent upon further Commission decision-making. Understanding the need for maximum predictability throughout these transitions, we will halt reductions in legacy support if for some unlikely and unanticipated reason the second auction phase does not take place as planned.

Re:ICC

• My enthusiasm here is tempered by the fact that end-user charges (under the label of “Access Recovery Charges”) are allowed to increase, albeit incrementally, for residential consumers.
• While I understand the need for predictability in an ICC regime, I am pleased that my colleagues have retained a key role for states, including arbitrating interconnection agreements; monitoring intrastate access tariffs during the transition to bill-and-keep; and helping to implement our Universal Service Fund as well as, in many cases, their own state universal service funds.
• There is inherent inequity in a system that funds the deployment of broadband off of assessments on interstate telephony. Once we ensure that double, triple and quadruple play services that benefit from Universal Service bear their fair share, we will not be subject to the unnecessary financial constraints that our current approach imposes. We also need
• spectrum management decisions that avoid putting still more spectrum in too few hands. Among other good results, that would drive better mobility auctions.

McDowell Comments 

• Also, today we are only addressing the high cost program of the distribution side of the Universal Service Fund. We are not addressing the entire Universal Service Fund, which currently distributes over $8 billion per year. To put that figure in context, USF is larger than the annual revenues of Major League Baseball. In separate proceedings, we will also reform the other USF spending programs. I cannot stress enough that all of the fiscal efficiencies that we will realize in the wake of today’s reforms will be lost if similar fiscal discipline is not applied to all Universal Service programs as well.
• It is no secret that for years I have been pushing for contribution reform to be carried out at the same time as distribution reform. Obviously, that is not happening today; therefore we must act quickly. The contribution factor, a type of tax paid by consumers, has risen each year from approximately 5.5 percent in 1998 to an estimated 15.3 percent in the fourth quarter of this year. This trend is unacceptable.

Clyburn Comments

• As you all know, I have a deep connection to rural America. Without comparable modern communications services enjoyed by their urban counterparts, those citizens will never adequately compete in our global economy. They need and deserve reliable fixed as well as mobile broadband in order to thrive. Without this critical broadband infrastructure, rural Americans would be forever left behind.
• Most importantly, we have provided for replacement funding as intrastate access rates decline as a result of our reform which relieves the financial burden that would have been on states in their own attempts at reform. To that end, we also have carefully balanced ICC revenue replacement for providers, with the important goal of not burdening consumers with significant increases in their bills or overburdening the USF which is ultimately paid for by consumers.
• Although the reforms we adopt today are extremely important for ensuring that basic and advanced communications services are physically available to all Americans, those services cannot be
• truly available, if consumers cannot afford to purchase them, the devices they need to access them are not available, or if they cannot obtain the skills they need to know how to use these services. I appreciate those who have called for us to address these consumer needs today, and I agree with you that we need to do more in this area. Our broadband adoption task force is working diligently to find solutions to these issues, and I fully expect that we soon will be addressing the proposal in our Lifeline proceeding to adopt pilot projects for broadband adoption to benefit low-income Americans who qualify for the Lifeline program.

Genachowsi Comments

• Over the next year, the Connect America Fund will bring broadband to more than 600,000 Americans who wouldn’t have it otherwise. Over the following five years, millions more rural families will be connected. And today’s Order puts us on the path to get broadband to every American by the end of the decade – to close the broadband deployment gap which now stands at close to twenty million Americans. We are also extending the benefits of mobile broadband coverage to tens of thousands of unserved road-miles, areas where millions of Americans work, live, and travel.
• Today’s action will help connect anchor institutions, which can play a vital role – for example, in expanding basic digital literacy training – in a world where broadband skills are necessary to find and land jobs.
• We did not rubber stamp or adopt wholesale the proposals of any stakeholder or group of stakeholders. Instead, we made our decisions on what’s right for the American people and our economy based on facts and data gathered in one of the most extensive records in FCC history, including hearings and workshops across the country, and more than 2,700 substantive comments totaling tens of thousands of pages.

The US Broadband plan establishes a 4 Mb goal for those lacking access to networks meeting the 100 Mb goal. Many assume that this goal will be met with mobile broadband networks. Will this be adequate to participate in today’s bandwidth intensive world?

Join LightSquared’s Geoff Stearn, VP of Spectrum Development, and Bob Bass from ATT to explore this question.

A lot of people have been asking questions about LightSquared; this could be a very interesting session. Please register – and bring your questions!

The webinar is part of the pre-conference series leading up to the Fall broadband conference: Policy & Progress: Border to Border Broadband.

It was a nice complement to the public hearing session hosted by the same groups last year. Last year Commissioner Copps and Commissioner Clyburn listened for *hours* as folks share their news, views and stories. It was an amazing turnout!

This meeting was a much smaller group and the topics were narrower in scope but included diversity in media ownership and representation, Low Powered FM Radio and policies to promote greater use of technology (broadband, telephone, radio) such as Net Neutrality and Universal Service Funds.

Commissioner Copps was generous to allow me to record the session. I didn’t catch the intros, because I wasn’t sure that everyone wanted to be archived – but I think his comments drew upon the remarks from the folks in the room.

I also took some very quick notes on the comments that just stuck out for me. So for a very high-level Reader’s Digest version I will include those notes below. Commissioner Copps will be done with his tenure at the FCC at the end of the year. I got the feeling that he was imparting some good advice on his way out to help community leaders work with the FCC in the future – and maybe to push the FCC to work harder. His key tip – Get Organized to Effect Change!

On Broadcasting & Access to Info

27 states don’t have local reporters in DC

Good journalism came from a time when journalists and owners remembered that there was an FCC that could penalize them for not doing good job.

Civic dialog can’t blossom without access to information.

Net Neutrality prevents the “cable-ization” of the Internet. We set guidelines. Now broadcasters don’t need to apply as often and the renewal is assumed – because generally renewal is a forgone conclusion.

Broadband

We recognize that we need a strategy and a plan to get broadband to rural areas. Everybody has to have access to broadband.

The USF is broken. And is costing consumers millions. The subscriber line fees might go up – but Copps won’t vote unless I know that the burden on the consumers will be reduced.

Universal access is the infrastructure challenge of the 21st century. We need to get it right.

Lifelink and Linkup will get attention in a month or so.

We found ways to build infrastructure in the past – with public/private sector collaboration. But then there was an idea (starting with Regan) that public-private collaboration was un-American.

Auction selling spectrum – one worry is the constriction of spectrum.

These problems get solved from the bottom up.

Three important steps to take:

• Access to Anchor Institutions
• Media/Digital/News Literacy
• Public Media & Support for Public Media

The Center for Science, Technology, and Public Policy (CSTPP) will host a lecture featuring two very different views about possible mergers in telecommunications giants AT&T and T-Mobile from 2 to 3:30 p.m. on Monday, October 3, in the Wilkins Room (Room 215) at the Humphrey School. Former Congressman Rick Boucher, now a partner in the Washington, D.C. office of Sidley Austin, and amalia delony, grassroots director for the Center for Media Justice will discuss their differing views of the proposed merger and take questions from the audience. Steve Kelley, director of CSTPP, will moderate the discussion.

It was an interesting discussion in many ways because the two main speakers agreed on so many points so unlike many debates today it wasn’t like trying to bring black to white or white to black. There was careful consideration of the nuance, details and ramifications of the decisions being discussed. I’ll include my pretty full notes below but I thought I’d include a quick list of pros and cons. (These are as stated by the speakers – not my personal pros and cons.)

For the Merger:

• It’s a good way to get to 98% broadband coverage in the US in the next 5-6 years without government spending.
• T-Mobile will probably be sold anyways the parent company is no longer interested in the American market
• 4G is broadband; it is faster than most rural communities experience now

Against the Merger

• A merger will mean a loss of jobs. T-Mobile’s workforce is 48% minorities
• AT&T is not known for quality customer service while T-Mobile is the most low-income-friendly with prices and service locations
• 4G may be broadband, but access through a smartphone alone is not enough. You can’t fill out a college application on your smartphone. People need

Former Senator Rick Boucher –
Now heads up the Internet Innovation Alliance – they agree on nationwide universal broadband. It is achievable. (Universal however is 9% broadband deployment within 5 year period)

1. Get the FCC to reform USF. The US has highest telephone rate. SO the USF has worked in terms of getting landlines to rural areas. It makes sense to modify USF to allow it to be expended for broadband as well as telephone. Right now the providers are small rural telcos – if they could use funds for broadband, they would.
2. Get the Legislature to allow the FCC to confer incentive auctions. Smartphones have taken off hugely. We’ll need more spectrum to accommodate smartphones.
1. The FCC would encourage spectrum owners (TV air owners) to give it up for a portion of auction proceeds. There are urban, independent stations that will take advantage of the opportunity.
2. Enough stations have expressed interest to make it worth trying. It might happen this year. The Super Committee is looking into it.
3. Support the merger between AT&T & T-Mobile. We have a goal of 98% broadband coverage. AT&T says within 6 years they will cover 97%. We think we can make up the rest from USF reform & financial support.

Why is the merger good for consumers?

T-Mobile will be bought by someone. Deutsche Telkom owns it and wants to get out of the American market. Few upgrades have been made.

Verizon 4G is as fast as my connection at home. It can be a stable and independent platform for access. We may see people give up cable & DSL to go wireless on 4G as people have given up their landlines. AT&T has said they will deploy 4G.

AT&T says it will honor T-Mobile customers contracts for the duration of the contract.

AT&T will remove one carrier from the national table – but it’s not anti-competitive in that 1 of the largest 20 cities, there will still be 5 or more wireless providers from which to choose. In the other 2 cities the merger requirements may mean that T-Mobile is broken down and sold to others.

The current major spectrum holder is Sprint. They control about 30 percent of all spectrum. Then Verizon and then AT&T. TO remain competitive, AT&T needs more spectrum.

amalia deloney

I don’t work for AT&T in any way, shape or form.

We agree on the importance of broadband. The Center for Media Justice is a think tank that represents marginalized communities. We work with grassroots communities of color.

The Media Action Grassroots Network is made up of community-based organizations. We want to build media policy that’s people centered and place-based. Our top concerns:

• Internet Freedom (Net Neutrality)
• Universal Service Fund
• Involve din low cost programs
• Safelink (mobile/tracphone)
• AT&T T-Mobile
• Created video on Mo Mergers Mo Problems
• Minnesota is leading a voice against the merger

Broadband connectivity is essential for education, healthcare… For low-incomes folks, jobs is the top concern. You can only apply for jobs online. So that means the Rondo Library in St Paul opens up with a 3-hour wait for a computer.

Why don’t we like the merger?

• We think the merger is a jobs killer.
• T-Mobile has chosen to build out in marginalized areas. It is the cheapest option. So many people use it. Nationally 4% of T-Mobile’s workforce is a minority.
• AT&T is notorious for bad customer service.
• The merger will leave a duopoly in the industry – that will not be good for customer service for users.
• Real competition doesn’t really exist right now. In many places there is only 1-2 providers.
• Wireless access is essential – but you can’t fill out a college application on your smartphone. They need affordable prices, the need protective policies.
• Families are getting broadband through their wireless devices. Wireless access is essential – but you can’t fill out a college application on your smartphone. They need affordable prices, the need protective policies

We want reliable, affordable service from a corporation with a connection to the community. We want to be innovators, not just consumers.

Boucher –

AT&T has not widely deployed 4G yet. The fifth generation iPhone is coming out soon. (Hopefully this week.) Verizon has done a pretty good job of 4G deployment.

AT&T has pledged to retain all of the call center positions from AT&T and T-Mobile. They will need those call center operators to handle the subscribers. This is one of the fastest growing industries in the US.

CWA & ALFCIO have both endorse the merger. The claim that up to 96,000 jobs will be created.

The FCC has a low definition of broadband. What do you call broadband?

Boucher – 3G isn’t real broadband; 4G is. And AT&T is looking at 20 Mbps.

deloney – it depends. Symmetrical upload/download is necessary.

Question: 20 Mbps in many rural areas would be a step up. Is there a difference in impact between a low-income users in rural vs urban area?

deloney – generally no. There’s a false division between communities that are underserved and unserved – but we would group them together. You face issues of being left behind. It’s not that people don’t understand that they need broadband.

People need reliability & affordability. Competition helps. Maintains a low cost providers helps too. Options are important for consumer rights.

Question: Customers are fluid and growing. Congress gave broadcasters spectrum with the ideas that they might give it back.

Boucher – 8 years ago Congress decided to prepare a path to transition from analog to digital. SO 700 MHz spectrum was opened up. The big change was getting home owners a digital TV set (or convertor box). We loaned the spectrum to the broadcaster so that they could broadcast on analog and digital. About 3 years ago analog broadcasting stopped. There were subsidies to buy convertors.

We got the spectrum back and that’s where the 4G is coming from.

Sprint in the largest spectrum holder and they don’t use much of it now.

Isn’t it possible to get to 98% broadband in 5-6 years without the merger?

Boucher – no. There will be a requirement in the law to make them cover 98% in that timeframe. AT&T won’t do it in the timeframe without the merger.

Verizon might be better poised, but they will build in the cities first.

deloney – There’s a question of how AT&T spends money – such as lobbying and a multi-billion dollar ads.

There are innovative solutions – ILSR in MN talks about community-based broadband networks. We can open up the discussion to talk about community-based solutions. Now is a good time to look at what models in which we should invest.

Boucher – I supported the bill that would have allowed easier connection to community-based networks. About half the states have prohibitions of some sort of network communications.

There ought to be an expanded definition to lifelink & linkup to include broadband options.

First – the latest activity. On August 31, 2011, the Department of Justice filed an anti-trust lawsuit to block AT&T’s acquisition of T-Mobile. The Department of Justice explains their move…

The Department of Justice today filed a civil antitrust lawsuit to block AT&T Inc.’s proposed acquisition of T-Mobile USA Inc. The department said that the proposed $39 billion transaction would substantially lessen competition for mobile wireless telecommunications services across the United States, resulting in higher prices, poorer quality services, fewer choices and fewer innovative products for the millions of American consumers who rely on mobile wireless services in their everyday lives.

The department’s lawsuit, filed in U.S. District Court for the District of Columbia, seeks to prevent AT&T from acquiring T-Mobile from Deutsche Telekom AG.

“The combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services,” said Deputy Attorney General James M. Cole. “Consumers across the country, including those in rural areas and those with lower incomes, benefit from competition among the nation’s wireless carriers, particularly the four remaining national carriers. This lawsuit seeks to ensure that everyone can continue to receive the benefits of that competition.”

Reaction to that lawsuit has really cemented the pros and cons as well as friends and foes of the merger.

Who’s for the merger?

Other large tech companies have apparently rallied around the idea of the merger as a means to build a better network more quickly. WIRED reports…

Sadly, some of the nation’s biggest tech players rallied to AT&T’s defense. Facebook, Yahoo, and Microsoft, among others, filed a petition in support of the merger, buying into AT&T’s threat not to build out a nationwide 4G network unless it got to buy T-Mobile.

Some folks have used the merger as a jumping point to open the spectrum discussion. Jeff Kagan, from E-Commerce Times points out that the merger is just an attempt to get more spectrum – a resource in scarce supply, which the author suggests should be reallocated…

If we are to survive, we have to come up with a bold solution. A wider hose. Otherwise the entire industry will face the same problems AT&T has been dealing with in recent years. So one idea is to take the spectrum back and pool it into a large group. Let every carrier and handset maker access it all. That way if one band is blocked because of heavy usage, the phone and the network can simply use another band. Simple solution.

In a very backhanded way, CNN Money points out that the merger has the potential to save money.

On page 51 of a long filing with the FCC in support of the merger, AT&T did get around to describing how the deal would save it $3 billion a year starting three years after it was complete. One of the ways will be “optimizing” the combined company’s retail and distribution networks (a process that traditionally involves more firing than hiring).

Unfortunately this is sort of a double-edged sword at a time when what the economy is really screaming for is jobs from private business – not saving and downsizing. Also, AT&T is saying that the merger will create jobs…

If the deal is approved, AT&T today said that it will be able to “bring back” 5,000 call center jobs to the United States that are currently outsourced to other countries. In addition, the company said that it doesn’t anticipate any job losses for U.S.-based call center workers after the merger closes.

Who’s against the merger?

The Center for Media Justice calls the Department of Justice block a major victory…

“Blocking this merger is a major victory for communities of color, rural communities and America’s poor. The Justice Department has taken seriously our real concerns about higher prices, fewer choices and massive job loss. This is the best possible end to our August Month of Action Against the Merger. The people spoke, and the Justice Department listened.”

Some maintain that Sprint must be happy with the delay – but even more interesting it outlines some of the issues facing mobile industry these days – like smartphone relationships and 4G networks…

But the most pressing issue facing Sprint, the analysts say, is its need to build a fourth-generation, or 4G, wireless network

WIRED also maintains that T-Mobile customers are happy to see the block..

“I’m so happy that I don’t have to be an AT&T customer.”

Again this important factor here is in the implication that T-Mobile is friendlier to customers. The Legal Talk Network also made that assertion and part of the concern for folks who are worried is that service will be adversely effected with a merger. T-Mobile is called out as a “disruptive factor” in the industry in terms of providing lower costs that have an impact on the prices competitors can charge.

I’m not sure how the lawsuit will end up – it was interesting to get a glimpse of the Judge Huville, who is presiding over the case. It will be interesting to see what happens next.